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Senate enacts Vitelli bill to make for-profit schools accountable to students

AUGUSTA — The Maine Senate voted unanimously Monday to enact LD 1404, a bill to require annual review of for-profit colleges and universities to ensure the schools are using tuition dollars to provide a good education for their students, not just profits to their shareholders.

The bill, “An Act to Ensure the Integrity of For-profit Colleges,” is sponsored by Sen. Eloise Vitelli, D-Arrowsic. It now goes to Gov. Paul Lepage who has 10 days to sign it into law, veto it or allow it to become law without his signature.

The legislation establishes standards and criteria for for-profit schools similar to those already in place for public institutions of higher education. For example, the bill would require for-profit schools to show that at least 50 percent of total spending is used for instruction and that no more than 15 percent of its spending is used for advertising. The State Board of Education would also determine whether a for-profit school is accredited to meet professional licensing and other standards relevant to the graduate’s degree.

If a for-profit college or university does not meet the minimum standards, the board could revoke the degree-granting authority of the school. They would also have to report metrics such as post-graduate employment rates and loan default rates.

“For-profit schools spend millions every year on advertising, but are not held to the same standard as our public universities,” said Sen. Vitelli. “It is time that for-profits schools are held to the same standard. This legislation would guarantee that students have the information they need to make wise decisions about their education and their future — I am happy that my colleagues in the Senate agree this is the right move for students.”

In a recently filed class-action lawsuit, the for-profit InterCoast Career Institute is facing charges from several nursing students that their education was a “sham” and that the nursing program lacked proper accreditation. This left those graduates with thousands in students loans and nothing to show for it.

The bill has earned the support of the Center for Responsible Lending, the Maine Education Association, the Maine Center for Economic Policy and Veterans Education Success.

The Portland Press Herald endorsed Vitelli’s bill in an editorial earlier this year, saying legislators should “give it serious consideration.”

“These schools are filling their coffers with taxpayer-backed loans, then failing to follow through on their promise to prepare students for a better job,” the Editorial Board wrote. “That backfired when two of the largest for-profit colleges, Corinthian Colleges and ITT Technical Institute, folded while under investigation for fraud, leaving taxpayers on the hook for forgiven loans, and it is backfiring in Maine when students get nothing but piles of debt out of their for-profit degree.”